Configurations of the MCS packages

When comparing the packages of MCSs of the four companies in this research by simply looking at Table 12, it can be noticed that the two companies with an American parent, Sensata Technologies and Eaton, have 3 of the 4 hard control components with a HIGH importance within the package, the 4th _hard control component is still of MEDIUM importance for these companies. Based on this, it can fairly be concluded that for the Dutch subsidiaries with an American parent at least the hard controls play a very important role in guiding and directing behavior of subordinates. For the originally Dutch companies, Mediq and Nedap, there is a less unambiguous picture regarding the importance of the hard controls within the configuration, when just looking at the classifications in Table 12. Where at Mediq, equal to the configurations of the Dutch companies with an American parent, 3 of the 4 hard control components have a HIGH importance and the 4th _{component is of MEDIUM importance, Nedap shows a} very different picture. In this company only 2 hard control components are classified as MEDIUM important, and the other 2 hard control components are even classified as of LOW importance. This ambiguous picture of the hard controls at the originally Dutch companies makes that it is, based on the classifications in Table 12, difficult to draw strong conclusions about the importance of hard controls in Dutch companies. The conclusion based on the classifications in Table 12 must be that in the Dutch subsidiaries with an American parent, the hard controls are very important and in the originally Dutch companies the hard controls show an ambiguous picture, so a difference between the two groups of companies cannot be concluded with certainty, but there is reason to suspect that there are differences.

MCS package component _Sensata Importance of component _{Eaton Mediq Nedap}

Administrative Controls MEDIUM HIGH MEDIUM LOW

Planning Controls HIGH HIGH HIGH LOW

Cybernetic Controls HIGH HIGH HIGH MEDIUM

Rewards and Compensation Controls HIGH MEDIUM HIGH MEDIUM

Cultural Controls MEDIUM HIGH HIGH HIGH

Table 12: Comparison over companies of configurations of packages of MCSs

The classifications in Table 12 regarding the soft controls show the reverse picture. At both originally Dutch companies the soft controls are considered of HIGH importance in guiding and directing behavior of subordinates. From the Dutch subsidiaries with an American parent, however, only one considers the soft controls of HIGH importance within the configuration and the other as MEDIUM important. So, for the soft controls a similar conclusion as for the hard controls must be drawn, based on the classifications in Table 12. For the originally Dutch companies the soft controls are considered very important and, in this case, the Dutch subsidiaries with an American parent show an ambiguous picture, so a difference between the two groups of companies cannot be concluded with certainty, but there is reason to suspect that there are differences.

Boudewijn Alink University of Twente 90 H1: Dutch subsidiaries with a US parent use a configuration of MCSs which is more oriented on hard controls and Dutch companies with a Dutch parent use a configuration of MCSs which is more oriented on soft controls.

nuances presented in the analyses of the companies are important additions to the classifications in Table 12. Especially with respect to concluding on the importance of the hard controls within the configuration of MCSs at the originally Dutch company Mediq. In the analysis of Mediq it was namely already mentioned that some of the hard control components are present to a high extent, and the respondent considers them as necessary, though not that important in guiding and directing behavior of subordinates. When taking this into account, this would bring the package of Mediq more in accordance with the package of the other originally Dutch company in the sample, Nedap, and increases the difference of it with the packages of the two Dutch subsidiaries with an American parent in the sample. So, the statement made above that there is reason to suspect that there are differences in the importance of hard controls within the configuration of the total package of MCSs between the originally Dutch companies and the Dutch subsidiaries with an American parent is justified even more. To give an answer to hypothesis H1, it is clear from the above that the Dutch subsidiaries with an American parent indeed have the focus on the hard controls within the configuration of their package of MCSs. With respect to the originally Dutch companies, there is no unambiguous conclusion possible based on the data, but presumably the focus is not on the hard controls in these companies. Regarding the soft controls it can be said that within the originally Dutch companies the focus is indeed on the soft controls, but for the Dutch subsidiaries with an American parent there is no unambiguous conclusion possible based on the data of this research. So, although based on this research it cannot be concluded that the Dutch subsidiaries with an American parent pay little attention to the soft controls, or that the originally Dutch companies pay little attention to the hard controls, this research confirms that the Dutch subsidiaries with an American parent implemented a configuration in which the hard controls are more important and the originally Dutch companies implemented a configuration in which the soft controls are more important.

As a further discussion on this conclusion it can be said that the fundament of this research and the answer above is the contingency theory, with in this case ‘national culture’ as contingency. The results, however, show that contingency theory, or at least ‘national culture’ solely, cannot fully explain the differences in the configurations of MCS packages in the companies subject of this research, because the MCS packages within the two distinguished groups do not correspond. Therefore there must be looked further to other possible explanations. These might be found in the studies of Cardinal et al. (2004, 2010), based on configuration theory. Possible explanations that can be drawn from these studies are (1) different current phases of the companies in their MCS package development, and (2) different MCS package starting points of the companies and the described pentimento-effect. When still assuming that there is a (partial) explanatory effect for the contingency ‘national culture’, then it can be that, for example, the two Dutch companies with an American parent will finally end up with a similar MCS package, but that these are both in a different phase of the dynamic development of their MCS packages, as Cardinal et al. (2004, 2010) describe. When the contingency ‘national culture’ plays no role, then all four companies are in different phases, where Sensata Technologies, Eaton and Mediq are most closely together and Nedap is far away from these. There is also evidence for the different starting points and the pentimento-effect in the MCS packages. Cardinal et al. (2004) refer to Hellman (1973) for the pentimento-effect as follows:

Boudewijn Alink University of Twente 91 “Old paint as it ages, sometimes becomes transparent. When that happens it is possible in some pictures, to see the original lines: a tree will show through a women’s dress, a child makes way for a dog, a large boat is no longer on an open sea. That is called pentimento because the painter “repented,” changed his mind. Perhaps it would be well to say that the old conception, replaced by a later choice, is a way of seeing and then seeing again (Hellman 1973).”

This effect also seems to appear in the MCS packages of the companies in this research. As noted in the analysis, the respondent at Eaton even mentioned this phenomenon explicitly:

“Maar vergeet niet dat wij natuurlijk wel een cultuur hebben die 100 jaar, of iets meer dan 100 jaar oud is. Niet een Eaton cultuur, maar een bedrijfscultuur. En die gooi je niet zomaar overboord.”

“Want, als je bijvoorbeeld zou zien wat het verloop is van mensen, die is heel erg laag. Dus die cultuur, die zingt hier nog steeds rond. En maar goed ook. Ik bedoel, wij zijn wel een Amerikaans, onderdeel van een Amerikaans concern, maar dit is niet een Amerikaanse mentaliteit wat hier heerst, hoor. Bedrijfsmentaliteit wel, maar onderling… “ “Maakt het misschien wel een beetje schizofreen af en toe, maar je bent niet zomaar je cultuur kwijt. Je bedrijfscultuur kwijt.”

Thus, although it became clear that the Dutch companies with an American parent changed their configurations of MCS components after the acquisition, and these seemed both to develop in the same direction, these have different starting points that are still present, eventually in latent form, and shine through the current states of the MCS packages. So, where the contingency theory on the single contingency ‘national culture’ seems to fail in explaining the differences in MCS packages entirely, the results of this research seem to produce proof for the configuration theory.